Still Picking Stocks? Time for a New Hobby

Is stock picking nothing more than a hobby for bored upper-class men? Felix Salmon, the Reuters blogger, recently wrote an interesting post making this argument.

The piece quickly turns into an exploration of online financial journalism (Salmon's own job). It also launches into a bit of media criticism about stock tickers scattered through stories.

There's a reason for all those tickers, having to do with how news stories get automatically distributed across sites. Salmon should know this perfectly well and seems to have forgotten.

The diversion into media, however, means Salmon gives the hobby argument short shrift, in our view. Time to dig back in.

The case against stock picking can be summed up like this: Men do it because they can. They have disposable incomes and time, the two things you really need for any serious hobby.

He goes on to break down the cost of stock picking. Salmon's argument is that it's a cheap hobby, at least compared to typical rich-guy pastimes such as collecting cars, flying planes or riding fancy racing bikes.

That may be true, but only considering the cost of stock-picking newsletters and services, which Salmon estimates at $5,000 a year. A pittance compared to adventure travel or wine collecting.

If only the losses stopped at $5,000 dropped on worthless stock ideas. The real cost is much, much higher.